With Effective Risk Management You Will Save Money
The determination of insurance premiums is more art than science. Insurance companies are driven almost entirely by competition. Plus, the cost of risk is difficult to quantify in the short run. Companies do refer to rating guides, but they are useful only in evaluating identical exposures (which never happens) and only to the extent that the past is a predictor of the future (unreliable at best). As a result, insurance underwriters may have a rough idea of the price they want to cover an exposure, but given the uncertainty they will try to obtain as much as the market will bear on any particular risk.
That’s where we come in. We will set up and orchestrate the competitive process for you, using multiple, independent sources so you are assured of the lowest reasonable price.
Our approach is more comprehensive and more effective. We will reduce the cost of your insurance program.
Why not do it yourself?
A typical insurance proposal is five to ten pages long, but the policies themselves often contain hundreds of pages. Unless you have the time and expertise to read and understand all the exclusions, limitations and conditions contained in those policies, you probably cannot adequately compare the competing offers and you may never know whether your insurance policy protects you from the real risks you face.
In addition, we can reduce your indirect loss (that part not covered by your insurance). For example, for every dollar of covered workers compensation benefits, your organization will suffer a loss equal to 2-3 times the covered amount in lost productivity, lost momentum and administrative expenses. Loss control programs, which we’ll help you identify and implement, can eliminate or greatly reduce these costly losses.
Finally, by contractually transferring risk to other parties, we’ll help you insulate your own insurance program, thus preventing premium increases.
Cost Savings Summary
In summary here is how your company will save money:
- Loss control to prevent losses, to keep your loss record clean
- Claims management to control the claims that do occur, to minimize payments to third parties – again minimizing effect on your loss record
- Formal loss control programs to make your company attractive to the insurance industry
- Contract management (re non-insurance contracts with your business partner to: a) minimize claims by transferring loss to other parties, and
- b) the contract management program making your company attractive to the insurance industry
- Finally, managing an RFP process utilizing many insurers through multiple brokers, setting up true competition for your business. The RFP process has to be managed professionally for many reasons, not the least of which is to prevent broker manipulation of the process.